10 Attributes Of The Perpetually Broke

We've all got friends in our lives that always seem to be having financial troubles. They have a hard time making ends meet, and they often end up having to ask family for a loan, get a cash advance from their credit card or signing up for a payday loan with horrible terms. They are just perpetually broke.

Why do these people always seem to have so many problems? A while back I talked about some of the traits of high net worth individuals. Today I thought I would look at a few of the attributes that broke people have that contribute to them continually finding themselves short of cash.

10 Attributes Of The Perpetually Broke

People who are always broke often have one or several of the traits written about below:

Like to blame their problems on outside forces: People don't like to see themselves as the source of their problems. While people certainly have problems that aren't caused by something they've done, far too often they will also try to shift blame when they should be looking at themselves. They blame their friends, family and the government. They believe that “the little guy just can't get ahead“.

Don't know where their money is going: Far too often people who are broke find themselves short because they've never tracked their monthly cash flow and their small expenses are adding up to consume everything they bring in. They really need to track their expenses for a month or two so that they can set up a plan.

They don't plan ahead: Money is short because they haven't set up a family budget and a saving and spending plan. If you set up a monthly cash flow forecast, and know exactly what you're going to spend in what categories -they'll do much better. If you fail to plan you can plan to fail.

Spend money on things they don't need: I'm sure we've all got one of those friends who just loves to spend money, and buy things just to say they have them. The newest Iphone just came out? They buy it even though they already have an older version. A new TV came out with a higher refresh rate than their current one? They buy one so they can say they have the newest and latest technology.

Fall prey to lifestyle inflation and keeping up with the Joneses: Often people with higher incomes have problems with staying ahead in their budget as well because they fall prey to lifestyle inflation. Instead of banking and saving raises, they raise their standard of living – buying a bigger better house, a new car and a new wardrobe. They feel like they have to keep up appearances with everyone in their neighborhood.

Always pay more than they have to: Often people who are broke have gotten there because they don't know how to shop for a deal, negotiate or ask for a discount. You can get a discount on just about anything – from electronics to health care. Never pay more than you have to!

They use credit like it's going out of style: Delayed gratification isn't something that they've heard of, and if they want something they just put in on credit. After all – it's at a 0% interest rate for the first 3 months! One purchase leads to another, and before they know it they've got thousands in credit card debt!

They rely on others to fix their problems: We've probably all known someone who is always going to their parents, family or friends to bail them out. They create a pile of debt, and then rely on the kindness of others to get them out of their bind.

They would rather have others think they are wealthy, than actually be wealthy: People who are always broke like to be seen as wealthy and successful, even if looking that way to others means that they're actually forfeiting the possibility of being wealthy in reality.

These 10 attributes of the perpetually broke are only meant as a starting point to get you thinking about how you view money. While you may not fall prey to most of these, I'm sure most of us have fallen prey to at least 1 or 2 of them at some point or another.

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Realizing that you're doing it is the first step to making changes, and improving your situation. Once you've realized your problem, it's time to set about doing a budget, and turning things around.

Can you think of more attributes that the perpetually broke often exhibit? Do you have some of those traits yourself? What can those people do to turn things around? Tell us your thoughts in the comments.

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Comments

Excellent article. I think the last one is pretty prevalent today (they all are but I see that one almost every day). People trying to act like high rollers, driving Hondas with 500 dollar rims and wearing gold, bling bling :)

I just have to laugh whenever I see cars like that because it oh so often mimics the car owners overall financial picture – puny car engine with pimped out rims and puny savings account with a pimped out Rolex on their wrist :)

Pete, great list! The biggest problem is short term thinking versus long term planning and it is just not an attitudinal problem. Many have grown in households that have had difficulty looking beyond the next paycheck and it is quite difficult to break out of that habit.Arohan´s last post ..Tax-Friendly States for Retirement

Phenominal List! 2 thoughts,
1) I think everyone falls victim to some item on the list at some point – I mean Don’t Keep up with the Jonses, isn’t that covered by one of the commandments! Coveting Neighbors Wife, hey back then the wife was property LOL! That is the extent of knowlege I have on the Bible

These are hurdles that most of us must overcome to break out of the cycle of “perpetually broke.”

The perpetually broke are not just trying to fool the neighbors: many convince themselves that they really are wealthy (or at least not as broke as they really are). Reality is easier to ignore than address. But, as mentioned, the facade of wealth is not the same as real wealth.Frank Frugal´s last post ..Save money and strengthen your family–play a game!

Peter you’ve hit the nail on the head with this list. It’s still amazing to me that highly educated people do not use common sense to project how they will live in retirement. Most get degrees and as a reward go out and spend like it’s the last day on earth.

My friends laugh at my wife and I b/c we choose to stay in modest home and drive 10 year old cars. But we recognize the importance for living for tomorrow and not today. I do not want my kids burdened with taking care of Mom and Dad.

Great list, I love the first one because it is so true. Many people who have nothing love to blame their position in life on anyone but themselves and their poor choices. If they overcharge their credit card or miss a payment because they don’t have money in the bank then it is “the evil credit card companies fault” and not their fault because they “just have to have the newest pair of Air Jordans” even if they can’t afford them :)

Wow, that is a lot of negative things to avoide. The good news is… most of these things can be avoided by simply changing your mindset!

Before I WOKE UP and realized that my money wasn’t going to magically manage itself, I fell prey to many of these negative behaviors. But once I changed my mindset and began realizing that all my financial problems were due to my own mismanagement… all the proper behaviors naturally started to fall into place.

Did it happen overnight? No. Don’t be silly. It takes hard work.

If you want all good things to happen w/o working for them, then you might as well stop reading this post and go buy some more stuff you don’t need with money you don’t have.

What a great list of attributes! I wholly agree!
To shift your mindset though it helps to look at where your money messages that create your present mindset come from. Once you figure that out it helps to shift them to reach your goals!

My husband works for a family owned business. There are 4 employees. The family moved from a house which was fully paid for to a $300,000 home, put their children in private school, and yet still have not done anything to market their business in the area. They sold their previous business, so that income flow has dried up. They have maxed out their business credit card; my husband found out after he placed an order with their primary supplier that the charge was declined. It seems that they paid the monthly rent on my husband’s office with the credit card. They often lecture about “finances”, but are the last ones to apply that to themselves. They are not interested in their staff branching out. Their staff is more financially capable of having a more successful business without debt and they would properly compensate their commissioned employees, not try to cut their pay. They do not want to “look bad” in their “circle”, especially at church.

Great post. I used to be a counselor and I would say most of these attributes are reasons why people have problems in general, especially not taking responsibility for their actions. And I definitely agree, first you have to admit their is a problem before you can help with it.

What a great list! I agree 100%. It is so important to live on a budget and be wise as you spend your money. Even though I may have the money to spend, there is nothing wrong with shopping sales, using coupons and paying bottom price for items so that I can continue to save money. We try to always pay cash for our purchases and increase our savings through smarter purchases to make ourselves more financially independent.

Hi Pete! Great list! I so often think that the reason the world is owned by such a small percentage of its population is because there are so very few people who are not blinded by money… it seems you are one of the few.

If only we can look past the money and find our value in something more than cash, we will all be able to offer our loved ones a much better life with more opportunities. We would be able to carry the Light a lot further!

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